Telstra said profit declined 21% in its fiscal first half to 31 December 2006, as customers abandoned landlines and costs rose to upgrade network and billing systems. Net income fell to AUD1.7 billion (USD1.33 billion) from AUD2.14 billion a year earlier. Revenue rose 2% to AUD11.7 billion on higher sales at its wireless and internet units, although the company reported spending more on advertising and equipment subsidies to attract customers; operating expenses increased 9.9% to AUD6.9 billion. Sales from its wireless operations rose 12% to AUD2.8 billion while internet revenues surged 30% to AUD865 million as customers on a broadband connection rose by almost 50% to 3.46 million. The company estimates its broadband market share rose to 45% from 43% a year earlier. Sales at its fixed line unit, however declined 5.6% to AUD3.62 billion, partly as a result of a net loss of 170,000 PSTN lines.